What does it mean to declare ETH on the balance sheet?

For a company, fund, or DAO, declaring Ethereum (ETH) on the balance sheet means officially reporting its value as part of the organization’s financial assets. This is crucial for legal, tax, and financial reporting reasons. The main steps usually include:

1. Recognizing ETH as an asset in the company’s accounting books
2. Valuing ETH holdings according to national or international accounting standards
3. Disclosing ETH holdings in annual financial statements and, if required, in tax returns
4. Applying the correct tax rules for gains, losses, and transactions involving ETH

France: Declaring ETH as a Corporate Asset

In France, corporate ETH holdings are recognized as “immobilisations incorporelles” (intangible fixed assets) for long-term holdings, or as “stocks” (inventory) for trading activity.
Main points:

• Accounting: Use French GAAP (“Plan Comptable Général”). Classify ETH as “Autres immobilisations incorporelles” (account 208).
• Valuation: Initial purchase value, re-evaluated at the closing rate for annual reports.
• Tax: Unrealized gains are usually not taxed, but realized gains (sales, swaps) are subject to standard corporate tax. Losses can sometimes be deducted.
• Reporting: ETH must be declared in the balance sheet and may be required in the “liasse fiscale”.
• Resources: French government crypto tax guide | Autorité des normes comptables (ANC)

United States: IRS, GAAP, and Corporate Crypto Reporting

• Accounting: ETH is generally classified as an “intangible asset” (FASB ASC 350) under US GAAP.
• Valuation: Recorded at cost, but companies may need to report impairment if the value drops (cannot increase value if ETH price rises unless sold).
• Tax: Realized gains are subject to standard corporate tax. No taxation for unrealized gains.
• Reporting: IRS now requires corporations to disclose digital asset holdings (see IRS Form 1120).
• Resources: IRS Crypto Guidance | FASB standards

United Kingdom: HMRC & Company Guidance

• Accounting: ETH is usually treated as an “intangible asset” for businesses (per HMRC’s crypto guidance).
• Valuation: At acquisition cost, or lower of cost and fair value (for year-end).
• Tax: Corporation Tax applies on gains realized at sale/disposal, not on unrealized gains.
• Reporting: Must declare in company accounts and tax returns; details may depend on the company’s main business activity.
• Resources: HMRC Business Crypto Guide

Other Countries & DAOs: General Principles

• Most countries treat ETH as either an intangible asset, inventory, or cash equivalent (rare).
• Key steps always include: recognizing, valuing, and reporting ETH as required by local law.
• For DAOs or decentralized entities: Always check local requirements where the DAO is based or where major contributors are tax residents.
• Resources: OECD Crypto Asset Reporting Framework

Resources & links

• Ethereum Treasuries main table
• What are Ethereum Treasuries? (explainer)
• French Crypto Tax Guidance
• US IRS Virtual Currency Guidance
• UK HMRC Crypto for Businesses
• OECD Crypto Asset Reporting Framework